Would appreciate some feedback for a starter that hasn’t started

[Rob Titus]

Separating from the military in about 2 months, after 14 years. Staying here in Jax, FL because I love it. I have been reading and watching about everything and under stand there is no “right way” to do it, but i just want to express my thoughts and questions and get some feedback before i pull the trigger on some of my steps. This is my plan and feel free to tell me what I’m doing right or wrong.

First note: i DO NOT have a **** ton of cash sitting around. But i do have a decent amount of equity in my primary home and some money in my retirement account. 

Funding: my plan is to shop around hard money lenders for purchase and rehab for best rates/fees/down payment. This brings up my first question(s). [Will a HML let me use a HELOC for the down payment and fees?] [Im also aware that most lenders require up to 6 months of reserves. Will they accept a HELOC as reserves also?] [Should i target a low priced property to reduce the amount i need to borrow?] My plan is to make interest payments with savings/income possibly HELOC.

Process: This is where i am the most lost. What do i do first, second, third etc.? Im just gunna throw everything out there and see what y’all say. 

Shop around for lenders, find a property (wholesaler/investor friendly agent), get a team together (contractors/inspector), walk the property with contractor? Inspector? or both? For rehab estimate

Side questions: Do i NEED a real estate lawyer? Are there any other “cover my ***” pieces i need to have? 

I know this is a loaded post and thank you to whoever takes the time to help!

[Jason Wray]

Rob,

If you are a veteran you can use your VA entitlement and either do a Cash out refinance up to 100% LTV or Buy another home using VA again. Question would be can you rent your current home for a profit/cash flow. If yes refinance it pull out some cash and then buy another primary home. If not you can take out up to 100% Cash out where you might lose a low first rate but good news you can refinance in 12-24 months and lower the rate.

Mortgage rates are getting better and will be back down in the next couple of years allowing you to refinance and recapture a lower rate if you take out cash now. Its a temporary situation and I am sure you have heard the phrase "Marry the home, Date the Rate!" I would avoid HML because Hard money loans suck and if you can avoid them its a plus to avoid paying points, prepayment penalties and Ballon payments.

You only need 15% down to buy an investment or 10% down to buy a Vacation home but if you can use VA that's 100% if it fits into your entitlement. If not you can refinance the current home switch to investment and free up all of your VA entitlement. If you choose to buy another primary you can use Fannie Mae and only need 5% even for a 2-4 unit.

You have a lot of options so make sure you add a good Banker to your circle or Network to help you explore all of your options. Feel free to reach out if you have any questions I enjoy helping and talking REI.